Baseball: not for smaller cities anymore?

CASH-STRAPPED TEAMS IN CITIES LIKE MINNEAPOLIS CAN'T COMPETE WITH THE BIGGER-MARKET CLUBS.

September 19, 2000

By Dante ChinniSpecial to The Christian Science Monitor

MINNEAPOLIS

As ballparks go, the Hubert H. Humphrey Metrodome is not a charmer.

Dropped in the middle of downtown, the home of the Minnesota Twins looks like a huge spacecraft - a great gray oval with red support poles and a white pillowy top.

And for most Minnesotans, the folly of its design is never more apparent than when a baseball game is scheduled for a brilliant, blue-skied day. Summer, after all, is the best time of the year: Why spend it indoors?

The way the Minnesota Twins see it, however, the Metrodome is a problem every game day - rain or shine.

As more and more teams build charming retro ballparks to lure fans to plentiful concessions and pricey skyboxes, Minnesota draws only about 14,000 fans to each game in its futuristic vault. The result, the team says, is that it doesn't have the money to compete.

The stadium issue is one part of a complex economic equation that could doom small-market teams to a downward spiral of failure or even lead to their relocation.

The story is familiar in all of America's major team sports, as the Green Bays and Edmontons of the athletic world attempt to compete with clubs from distended metropolises such as New York and Los Angeles. But by all measures, the problem is the most acute in baseball. Large-market owners have adamantly refused to share money with their smaller counterparts - as other sports have - rejecting any serious attempt at making a more-level league. And players have also so far rebuffed any plans for a salary cap.

One answer, owners say, is to build cozy new stadiums in an attempt to draw more fans and generate more money through lucrative ventures like luxury boxes. It certainly worked in Cleveland - one of the first cities to build a new park - as the Minneapolis-size city turned itself into a perennial contender.

But now that most teams have new fields, some economists say the financial jolt isn't as significant as it was back when the building boom began in the early 1990s. Indeed, they say, stadiums will never enable cities like Minneapolis to catch up with the Yankees and Dodgers, which make millions in huge local TV contracts.

Seeking remedies

As the gap between the haves and have nots has grown more pronounced, baseball is addressing the issue with increasing urgency.

In July, a special Blue Ribbon Panel, made up of former Federal Reserve Chairman Paul Volcker, former Sen. George Mitchell, and political columnist and ber-baseball fan George Will, examined the game's financial state and found a lot of bad news. According to the report, only three teams had turned a profit since 1995; the rest were swimming in red ink - including the Twins, with losses of more than $36 million.

The panel called for major restructuring of financing that would level baseball's economic playing field, including the establishment of 40 to 50 percent revenue sharing, a minimum payroll of $40 million for all teams, and a luxury tax on teams with payrolls larger than $84 million. Similar moves in recent years have allowed pro football to thrive. In the 1998-99 season, not a single NFL team ended up with a loss.

The panel also recommended that if organizations can't field competitive, financially sound teams, relocating franchises "should be an available tool."

The report is now in the hands of Baseball's commissioner, Bud Selig, and owners. And that's where things get sticky. Among those who study the game, there's a lot of questioning about how serious the owners are about changes - and about their claims of financial loss.

"The numbers in that report are absolutely cooked," says Daniel Rascher, who teaches sports economics and finance at the University of San Francisco. "They are directly from the owners, and owners like these numbers because they like to hold something over the cities. One of the best tests is [that] a team has never folded," he says, suggesting that if they were really losing so much money, they wouldn't exist.

Still, Mr. Rascher maintains, the threat of teams moving is "more legitimate than it's been at any time in the past 20 years. Things have just gotten so far out of balance between the haves and have nots."

For the first time in years there is serious talk in baseball of moving teams again. Some of the leading candidates for U-Hauls are the Montreal Expos, Oakland A's, and the Twins.

Minnesota's decision

All of this leaves the state of Minnesota and the Twin Cities in a quandary. With baseball beginning to talk about moving again, it is hard to know whether to take the stadium threat seriously or to treat it as a game of chicken.

Some words have been ominous. Mr. Selig dropped by earlier this summer and unceremoniously told the Minnesotans for Major League Baseball, a group studying the stadium issue, "I come here to tell you today that you need to get it done."

And the Twins aren't talking. They refused several requests for interviews for this article and have tried to ignore local opponents.

"My involvement in any kind of negotiations for a new stadium has been minimal, because they won't talk to me. [Owner Carl Pohlad] could be losing money. There's no way of knowing," says state Sen. John Marty, a Democrat from suburban Minneapolis who calls himself a fan who opposes public financing.

Fans are skeptical as well.

"It's all smoke and mirrors," says Mark Martens, a Twins fan from St. Paul, Minn. "[The owner] has to open the books and let everyone see."

Regardless, the question now is whether baseball will make the changes that Mr. Will's panel proposed, says Senator Marty. If they do, such stadium issues will essentially become moot. "By definition, fixing the problem is no longer needing these subsidies," Marty says.

Maybe and maybe not.

"We all agree that stability is favorable," Will says, but even with better financial parity, the moving issue isn't dead. It's hard to argue, for instance, that New York couldn't support a third team.

"There may be places where the economics aren't feasible, and in those towns it may be, 'So long,' " he says.

All of which means that whatever Major League Baseball decides about evening out funding, some of the game's biggest public-relations issues aren't likely to go away soon.

(c) Copyright 2000. The Christian Science Publishing Society

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